Foreclosures Changing the Appearance of Wales University

June 9th, 2009 | Tags: Real Estate

Foreclosure Homes are changing the get up and appearance of Wales University Student housing. It will now have a majestic view of the river, countertops of granite, appliances made of stainless steel and 9’ high ceiling. When classes will resume this autumn, if things turn out to be as planned, over 300 students at the university will be residing in Capital Cove. The latter is an upbeat condo project that has been running to seed for the last six months – a victim of the foreclosure crisis.

Irving Schneider of Johnson&amp (Wales Providence campus) said, “It’s a great Band-Aid”. Recently a three year lease has been signed for the development of Capital Cove. This agreement will be of benefit to the developer as well as to Johnson .

Other universities too across the country have found the silver lining in the foreclosure blues. The half finished condos have left the developers gasping for breath. Universities in New York and Ohio are snapping whole condo projects at express speed. They are either buying or leasing these. The universities are also hunting for vacant plots that had once been the prerogative of condo hunters for setting up malls and parking places.

Dan Fasulo of Real Capital Analytics said, “This is a bonanza of an opportunity … for universities to acquire the space they desperately need.”

For developers who had given up all hope on the projects, these offers have turned out to be life savers. Now they have before them an exit strategy from the failing projects. They will now be able to offload dozens of units that are remaining unsold to one single buyer rather than go through the travails of selling them bit by bit.

Jack McCabe an analyst said, “They can’t sell them, they can’t mothball them, they can’t bulldoze them Developers rights now are looking for every way not to lose their projects into foreclosure.”

Condo sales have dropped by 9% from 2008 and are less by a whopping 46% from 2005 – the time of the frenzied housing boom. According to the National Association of Realtors the sluggish sale has resulted in the piling up one year’s supply of properties in the real estate market.

Robert Roth the developer has been able to complete only one out of the planned 5 buildings on the 5 acre plot of land that connects the downtown suburbs of Providence with the residential part of the city’s east side. He started selling the condos from last autumn with a price range stretching from $350,000 to $550,000 but has so far managed only five bookings.